CONFIDENTIALITY,
NON-COMPETITION
AND NON-SOLICITATION EMPLOYMENT AGREEMENT –
ZIMMER OPERATING COMMITTEE MEMBERS
This
Confidentiality, Non-Competition and Non-Solicitation Employment
Agreement (this “Agreement”) is made by and between
Zimmer, Inc. (“Company”) and
(“Employee”).
A. For
purposes of this Agreement, “Parent” means an entity
which is a holding company of or holds a controlling interest in
Company; “Affiliates” means a subsidiary of Company or
the Parent of Company or a company over which Company or any
holding company of Company has control; and the definition of each
of Company, Parent and Affiliates, includes any of their
successors-in-interest. References herein to Company shall be
deemed to include any Parents or Affiliates.
B. Company,
Parent and the Affiliates are part of the global holdings of Zimmer
Holdings, Inc., a publicly traded corporation incorporated under
the laws of the state of Delaware, U.S.A., the primary purpose of
which is to serve as the umbrella entity for Company. Company,
Parent and the rest of the Affiliates located throughout the world
are engaged in the highly competitive business of the development,
manufacture, distribution, and sale of orthopaedic medical, oral
rehabilitation and/or spine or trauma devices, products, and
services.
NOW, THEREFORE, in
consideration of the foregoing recitals, Company’s employment
of Employee, the grant of equity-based awards to Employee under an
equity incentive plan of Zimmer Holdings, Inc., including the grant
of stock options, restricted stock and/or restricted stock units,
and the promises and covenants contained in this Agreement, the
sufficiency of which is hereby acknowledged, and intending to be
legally bound hereby, Company and Employee agree as
follows:
1.
Acknowledgements . Employee acknowledges that Company
is engaged in the highly competitive business of the development,
manufacture, distribution, and sale of orthopaedic medical, oral
rehabilitation and/or spine or trauma devices, products, and
services. Employee acknowledges that Employee has significant
responsibility for Company’s overall competitive position and
business strategy as related to its operations worldwide. Further,
Employee acknowledges that in the course of Employee’s
employment with Company, Employee i) has been given and will
continue to be given access to trade secrets and other Confidential
Information (as hereinafter defined) related to all aspects of
Company management; ii) has participated and will continue to
participate in the development of, execution of, and/or usage of
inventions, products, concepts, strategies, methods, or
technologies which are related to Company’s business; iii)
has been given and will continue to be given specialized training
relating to Company’s products and/or processes; and/or iv)
has been given and will continue to be given access to
Company’s customers and other business
relationships.
2.
Termination of Employment . Company and Employee
acknowledge and agree that Employee’s employment is on an
at-will basis, and, accordingly, either Company or Employee may
terminate the employment relationship at any time for any reason,
or no reason whatsoever, with or without cause, and without advance
notice.
3.
Non-Disclosure of Confidential Information . Employee
acknowledges that Confidential Information is a valuable, special,
and unique asset of Company, Parent, and the Affiliates, and agrees
to the following:
(a)
Confidential Information Defined . The term
“Confidential Information” includes, but is not limited
to, any and all of Company’s, Parent’s or
Affiliates’ trade secrets, confidential and proprietary
information and all other information and data of Company that is
not generally known to the public or other third parties who could
derive economic value from its use or disclosure. Confidential
Information includes, without limitation, the following: i)
marketing, sales, and advertising information such as lists of
actual or potential customers; customer preference data; marketing
and sales techniques, strategies, efforts, and data; merchandising
systems and plans; confidential customer information including
identification of purchasing personnel, account status, needs and
ability to pay; business plans; product development and delivery
schedules; market research and forecasts; marketing and advertising
plans, techniques, and budgets; overall pricing strategies; the
specific advertising programs and strategies utilized, and the
success or lack of success of those programs and strategies; ii)
organizational information such as personnel and salary data;
merger, acquisition and expansion information; information
concerning methods of operation; divestiture information; and
competitive information pertaining to Company’s distributors;
iii) financial information such as product costs; supplier
information; overhead costs; profit margins; banking and financing
information; and pricing policy practices; iv) technical
information such as product specifications, compounds, formulas,
improvements, discoveries, developments, designs, inventions,
techniques, new products and surgical training methods; v)
information disclosed to Employee as part of a training process;
and vi) information of third parties provided to Employee subject
to non-disclosure restrictions for use in Employee’s business
for Company. Confidential Information also includes any work
product created by Employee in rendering services for
Company.
(b)
Non-Disclosure of Confidential Information . During
Employee’s employment with Company and thereafter, Employee
will not disclose, transfer, or use (or seek to induce others to
disclose, transfer, or use) any Confidential Information for any
purpose other than i) disclosure to authorized employees and agents
of Company who are bound to maintain the confidentiality of the
Confidential Information; and/or ii) for authorized purposes during
the course of Employee’s employment in furtherance of
Company’s business. Employee’s non-disclosure
obligations shall continue as long as the Confidential Information
remains confidential and shall not apply to information that
becomes generally known to the public through no fault or action of
Employee or others who were under non-disclosure obligations as to
such information.
(c) Protection
of Confidential Information . Employee will notify Company in
writing of any circumstances which may constitute unauthorized
disclosure, transfer, or
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use of
Confidential Information. Employee will use Employee’s best
efforts to protect Confidential Information from unauthorized
disclosure, transfer, or use. Employee will implement and abide by
all procedures adopted by Company to prevent unauthorized
disclosure, transfer, or use of Confidential
Information.
4.
Ownership of Confidential Information and Inventions
.
(a) Invention
Defined . The term “Invention” includes, but is not
limited to ideas, programs, processes, systems, intellectual
property, works of authorship, copyrightable materials,
discoveries, and/or improvements of which Employee conceives alone
or in conjunction with others during Employee’s employment
with Company and/or within six (6) months after
Employee’s employment ends which relate to Company’s
present or future business. An Invention is covered by this
Agreement regardless of whether i) Employee conceived of the
Invention in the scope of Employee’s employment; or ii) the
Invention is patentable.
(b) Ownership
of Confidential Information and Inventions . Confidential
Information and Inventions are solely the property of Company.
Employee agrees that Employee does not have any rights, title, or
interest in any of the Confidential Information or Inventions.
Nonetheless, Employee may be recognized as the inventor of an
Invention without retaining any other rights associated
therewith.
(c) Disclosure
and Assignment of Inventions . Employee hereby assigns to
Company all right, title and interest Employee may have in any
Inventions that are developed, made, authored, or conceived by
Employee (whether alone or with others) during Employee’s
employment with Company. Employee agrees to: (i) promptly
disclose all such Inventions in writing to Company; (ii) keep
complete and accurate records of all such Inventions, which records
shall be Company property and shall be retained on Company
premises; and (iii) execute such documents and do such other
acts as may be necessary in the opinion of Company to establish and
preserve Company’s property rights in all such Inventions.
This section shall not apply to any Invention for which no
equipment, supplies, facility or trade secret information of
Company was used and which was developed entirely on
Employee’s own time, and (1) which does not relate
(a) directly to the business of Company or (b) to
Company’s actual or demonstrably anticipated research or
development, or (2) which does not result from any work
performed by Employee for Company.
5.
Return of Confidential Information and Company
Property . Immediately upon termination of Employee’s
employment with Company, Employee shall return to Company all of
Company’s property relating to Company’s business,
including without limitation all of Company’s property which
is in the possession, custody, or control of Employee such as
Confidential Information, documents, hard copy files, copies of
documents and electronic information/files.
6.
Obligations to Other Entities or Persons . Employee
warrants that Employee is not bound by the terms of a
confidentiality agreement or any other legal obligation which would
either preclude or limit Employee from disclosing or using any of
Employee’s ideas, inventions,
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discoveries or
other information or otherwise fulfilling Employee’s
obligations to Company. While employed by Company, Employee shall
not disclose or use any confidential information belonging to
another entity or other person.
7.
Conflict of Interest and Duty of Loyalty . During
Employee’s employment with Company, Employee shall not
engage, directly or indirectly, in any activity, employment or
business venture, whether or not for remuneration, that i) is
competitive with Company’s business; ii) deprives or
potentially could deprive Company of any business opportunity; iii)
conflicts or potentially could conflict with Company’s
business interests; or iv) is otherwise detrimental to Company,
including but not limited to preparations to engage in any of the
foregoing activities.
8.
Non-Competition Covenants . Company and Employee
acknowledge and agree that the following non-competition covenants
are reasonable and necessary to protect the legitimate interests of
Company, Parent and Affiliates, including, without limitation, the
protection of Confidential Information, Inventions and goodwill.
Employee agrees to, and covenants to comply with, each of the
following separate and divisible restrictions:
(1)
“Competing Product” is defined as (a) any
orthopaedic implant, product, process, or service; any dental
reconstructive implant, product, or service; any spine implant,
product, process or service; any trauma product or service; or any
other product or service, in each case that is similar to (or would
serve as a substitute for) and competitive with any orthopaedic
implant, product, process, or service; any dental reconstructure
implant, product, process, or service; any spine implant, product,
process, or service; or any trauma product or service; or any other
product or service, in each case that Company, Parent and/or
Affiliate is researching, developing, manufacturing, distributing,
selling and/or providing at the time of Employee’s
termination of employment with Company and which Employee worked in
conjunction with or obtained any trade secret or other Confidential
Information about at any time during the two years immediately
preceding the termination of Employee’s employment with
Company; and/or (b) any product or service that is similar to
(or would serve as a substitute for) and competitive with any
product or service that Company, Parent and/or Affiliate is
researching, developing, manufacturing, distributing, selling
and/or providing at the time of termination of Employee’s
employment with Company and which Employee worked in conjunction
with or obtained any trade secret or other Confidential Information
about at any time during the two years immediately preceding the
termination of Employee’s employment with Company.
(2)
“Competing Organization” is defined as any organization
that researches, develops, manufactures, markets, distributes
and/or sells one or more Competing Products or has plans to
research, develop, manufacture, market, distribute, and/or sell one
or more Competing Products. A Competing Organization is diversified
(“Diversified Competing Organization”) if
(a) it
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controls or is
in common control of entities which conduct business in an industry
other than the orthopaedic products industry or the dental
reconstructive, spine implant or trauma products industries, or
(b) operates multiple business divisions, units, lines or
segments some of which do not involve any Competing
Products.
(3)
“Prohibited Capacity” is defined as: i) the same or
similar capacity or function in which the Employee worked for
Company at any time during the last two years of Employee’s
employment; ii) any executive or managerial capacity; iii) any
sales or sales management capacity; and/or iv) any other capacity
in which Employee’s knowledge of Confidential Information
and/or Inventions would render Employee’s assistance to a
Competing Organization a competitive advantage.
(4)
“Restricted Geographic Area” is defined as the
following: i) the continental United States; ii) Canada; iii) Latin
America; iv) Asia/Australia; v) all countries of the European
Union; vi) Switzerland; and vii) all other countries, territories,
or states in which Company is doing business or is selling its
products at the time of termination of Employee’s employment
with Company.
(5)
“Non-Competition Period” is defined as the date
Employee executes this Agreement, continuing through the eighteen
(18) months after the Employee’s last day of employment
with Company unless otherwise extended by Employee’s breach
of this Agreement.
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